Suppose a monopolist faces a demand curve given by the equation P=200-2Q. Marginal cost is constant...
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Suppose a monopolist faces a demand curve given by the equation P=200-2Q. Marginal cost is constant and given by the equation MC = 20. a. Using the information above, what is the monopolist's profit-maximizing level of output? units b. Assume marginal cost is equal to average total cost. How much profit will the monopolist make? Do not include commas or a dollar sign ($) in your answer. c. What would be the value of consumer surplus if this market was perfectly competitive? Do not include commas or a dollar sign ($) in your answer. d. What is the value of the deadweight loss created by the monopoly? Do not include commas or a dollar sign ($) in your answer. Suppose a monopolist faces a demand curve given by the equation P=200-2Q. Marginal cost is constant and given by the equation MC = 20. a. Using the information above, what is the monopolist's profit-maximizing level of output? units b. Assume marginal cost is equal to average total cost. How much profit will the monopolist make? Do not include commas or a dollar sign ($) in your answer. c. What would be the value of consumer surplus if this market was perfectly competitive? Do not include commas or a dollar sign ($) in your answer. d. What is the value of the deadweight loss created by the monopoly? Do not include commas or a dollar sign ($) in your answer.
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a To find the monopolists profitmaximizing level of output we first need to find the monopolists mar... View the full answer
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